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COVID-19: Legal Obligations Regarding Employment Matters in Mexico

Mexico is starting to experience the first effects of the COVID-19 global pandemic. Among the first preventive measures being implemented in our country to prevent the growth of infections of said virus is “social distancing.” This strategy includes new coexistence rules in the workplace, quarantines, home office and the possibility of the announcement of a sanitary contingency. Below, we describe some of the possible legal effects of these measures under Mexican employment legislation.

Employees diagnosed with COVID-19

The provisions relating to non-professional sickness set forth in the Federal Labor Law (“FLL”) and in the Social Security Law (“SSL”) will apply to those employees who have tested positive for the disease, that is, who have contracted COVID-19 in the exact same manner in which these apply to any other non-professional sickness contracted by an employee. Thus, if an employee is absent from work by reason of being diagnosed with COVID-19, the employment relationship with such employee will be suspended and the employer will have no obligation of paying him any salary or benefits until the disappearance of such disability and once the employee returns to work (the disability may last up to 78 weeks). When this disability is declared by a doctor of the Instituto Mexicano del Seguro Social (“IMSS”), beginning on the fourth day after such declaration, the IMSS will cover to the employee a subsidy in an amount equal to 60 percent of the amount of the employee’s last salary declared to IMSS. The payment of this subsidy and the duration of the disability may last no more than 78 weeks.

Employees working remotely (home office)

If an employer allows or instructs its employees to cease attending the employer’s premises or working centers in order to work from their homes or any other place, this will not affect the terms of the employment relationship. The rights and obligations between them will remain unaltered, the employees will continue to be obligated to render their services in the same manner, although now remotely, and the employer will continue to be obligated to pay them their salary and benefits as usual.

Employees in quarantine – that cannot work remotely

If due to prophylactic reasons – preventive quarantine – an employer decides to suspend the work and office attendance of employees who have yet to be issued with a disability by IMSS for COVD-19, but who cannot work remotely for any reason, for example for not having the technical capabilities that allow such work to be done (due to lack of the necessary equipment or the grid for it) or else, because their work activities are not susceptible of being carried out remotely but only at the premises of the employer (i.e. cleaning and kitchen duties), the employer must continue paying the salary and benefits of such employees as this unilateral decision from the employer does not qualify as a reason to suspend the employment relationship under the FLL.

Proclamation of a Sanitary Contingency

Should government authorities proclaim a sanitary contingency that decrees the suspension of work in all work centers, employers will be relieved of their obligations to pay salaries and benefits throughout the duration of the contingency, and employees will not be obligated to render services – sanitary contingencies are expressly set forth in the FLL as events that suspend employment relationships. In such an event, employers will, however, be obligated to pay their employees an indemnity consisting of one minimum daily wage up to 30 days counted as of the date in which the sanitary contingency comes into effect. The minimum daily wage is currently set at MX$185.56 in the Free Zone of the Northern Border and MX$123.22 in the rest of the country.

It is our opinion, but yet to be determined, that an agreement between an employer and its employees for the latter to continue working remotely (home office) even in the case of a sanitary contingency decree, will be valid. If so, the employer will be obligated to pay them their salary and benefits as it ordinarily does. Although the FLL does not foresee this, it should be considered in determining how to proceed.

Granting temporary financial aid and other support means throughout the pandemic

The temporary measures that an employer may adopt to the benefit of its employees to help them address the pandemic -- such as, but not limited to, financial and/or in-kind aid (i.e. reimbursement of the cost of medicines, free medical examinations) or modification of working conditions (i.e. shorter and/or flexible working schedules, changing eating hall conditions) – are not expected to create unwanted consequences for the employers – such as becoming a permanent benefit once the pandemic is over. The rationale for these measures will be of a temporary nature, linked to the duration of the pandemic. In this sense, we recommend that employers fully and carefully document any such measures, so that their purpose and term of application be clear.

©2020 Greenberg Traurig, LLP. All rights reserved. National Law Review, Volume X, Number 80
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About this Author

José Carlos de Uriarte, Labor and Employment Attorney, Mexico City, Greenberg Traurig Law Firm
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José Carlos de Uriarte has a multidisciplinary legal practice with a strong emphasis in labor and employment matters, where he has over 20 years of experience regarding individual and collective (union) labor matters, administrative labor matters, employee benefits and executive compensation, separation of top tier executives, design of stock, RSU and retirement pension plans, designing strategies to meet outsourcing of employees challenges, individual and collective litigation, administrative inspections, regulations and litigation.

5255-5029-0024
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